Debt collection is the pursuit of payments owed and due to a creditor. In order to make up for their losses, lenders usually “sell” delinquent accounts to collection agencies, as a way to remove these accounts from the creditors' accounts receivable records.

After multiple attempts by the creditors and lenders at collection and not having any gains, for a small fee, a collection agency (which specializes in retrieving receivables) is employed, as a last resort to at least get back something back from the consumers or borrowers. This collection arm has an incentive and has more to gain from the collection process.

Send the credit bureaus a typewritten letter requesting for an investigation—to the address that they have specified for dispute information. It would not cost the consumer anything. If the bureau cannot verify the information that the consumer is disputing, it must remove it from the report, although there is a “request for reinvestigation form (F-24)” that the consumer must complete.

Every state has its own regulations on debt collection practices, as well as certain laws that debt collection agencies are expected to abide by. Before getting to the nitty-gritty, we need to start by first discussing the law that governs the activities of collections activities in the country—the FDCPA, or the Fair Debt Collection Practices Act.